A new
vendor entering the mature copier market is about as rare as
Halley's Comet. Only instead of 75 years, we just had to wait
one year for Samsung's first internally developed A3 MFP to
orbit over North America. Although the U.S. launch of
Samsung's first A3 line does not come as much of a surprise,
the industry should brace for impact, as the Korean
consumer-electronics giant's entrance could be significant.
Up until now, Samsung has carved out a notable presence in the
A4 printer space with a respectable line of SOHO-oriented
laser printers, strong OEM engine supply relationships, and a
fleet of well-liked enterprise-class A4 MFPs. However, with
its previous printing portfolio, Samsung was unable to truly
support a single line dealer or meet the requirements of most
major enterprises or MPS deals, forcing the vendor to accept
its role as a supplemental printing solutions provider
targeting primarily SMB accounts. It has also become
increasingly clear in recent years that copier manufacturers
are no longer interested in letting A4 vendors such as Samsung
"supplement" their lines, as each major A3 player has either
expanded, launched, or is planning its own enterprise A4
products. While the addition of four low-to-mid volume A3s
does not immediately change Samsung's enterprise printing
market positioning, especially given its current channel reach
of roughly 150 dealers, this launch is a step in the right
direction towards the vendor becoming a full-line provider and
bolsters its wider-reaching goal of becoming the world's
leading IT manufacturer.
However, Samsung's new A3 line does face its challenges, as
the vendor has achieved much of its enterprise printing
success by exploiting the A4 holes in most copier vendors'
lineups. Most of Samsung's current channel partners already
carry at least one far more established copier brand in
addition to their current Samsung A4 MFPs, and a large number
of these dealers would likely be hesitant to add a second or
third A3 brand without notable product-based differentiators,
assurance of the models' reliability, and attractive margin
incentives.
With that in mind, Samsung adopted an overwhelmingly
dealer-friendly message in statements surrounding its new A3
line:
• Samsung emphasized that, unlike most competing copier
vendors, it does not sell directly and therefore will always
serve its dealers in a support role, rather than as a
competitor.
• The vendor highlighted the oversaturation of existing copier
brands in some markets, suggesting that its new A3 models
could at the very least provide its dealer partners with
brand-based differentiation.
• Samsung addressed the models' profitability, suggesting that
the new A3s are easy to maintain and install, come with a
dealer-friendly 36-month warranty for parts, and will be
supported with special pricing when sold into major accounts.
Each of these claims were made at the Samsung dealer meetings
that preceded the A3 line's launch and should be viewed in the
same objective light as any dealer meeting statements.
However, Samsung is certainly correct in addressing the
discontent that many dealers feel regarding their adversarial
relationship with their own suppliers' sales forces. The
vendor is also wise to reinforce the new line's ease of
maintenance qualities and overall profitability, which once
proven, will be the key influencers in the line's adoption by
Samsung's current A4 resellers and the wider independent
dealer channel.
But the question remains: How will Samsung's A3 MFPs affect
the copier market?
Given the new line's channel challenges, in addition to the
overarching theme of falling page volumes and (ironically) the
buzz surrounding a shift from A3s to A4s, Samsung surely
maintains realistic expectations for the new line's first year
on the market. Samsung's market share in the above-$1,000 MFP
segments has grown in recent years, but remains in the very
low single digits, and it's unlikely that the new A3s will
significantly affect that figure right away. However, it is
clear that the new A3 MFPs hold both financial and strategic
significance for Samsung and the vendor has certainly proven
doubters wrong in the past when it successfully entered new
and perceivably mature consumer electronics and IT markets.
With that, much of the next year will likely be devoted to
building the A3 line's distribution and reputation across
Samsung's current office machine dealer partners in hopes of
expanding its dealer network, market share, and possibly its
A3 portfolio in the years to come.
While many details regarding Samsung's premier A3 MFP line are
still unavailable, information regarding the new models'
capabilities, in addition to the emphasis that Samsung is
placing behind their launch, suggests that the new copiers'
impact could be significant. Although the most immediate
change will likely be felt on a micro scale, as the models
capture sales that would have gone to their dealer partners'
other A3 brands as well competing dealers' copier brands, the
line's possible success would likely have much more
far-reaching consequences, as it would elevate Samsung's role
and capabilities in the office printing space and likely lead
to continued investments and expansion from the emboldened
vendor.
Jake
Fishman is a senior market analyst for Gap Intelligence, a San
Diego-based independent technology research firm with emphasis
in helping product manufacturers and resellers understand
current market trends in order to respond to customer demands
as they occur. He can be reached at
Jfishman@gapintelligence.com.
